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The Best High Interest Savings Account
Savings accounts are a necessary piece to everybody’s financial picture. This type of account can be used to set money aside to pay debts, save for emergencies, travel, property and to enjoy life.
Where should I put my savings accounts?
Having one savings account can be ineffective because you don’t have a clear goal for that money. If money is pooled into one single account, it can be deceiving. Instead, consider breaking up your savings into sinking funds and an emergency fund.
What is an Emergency Fund?
An emergency fund is a savings account that has 3 or more months of expenses. For example, if your car payments, bills, rent, and regular spending comes to $2,000 a month, you want your emergency fund to have at least $6,000 in it. 3 months is a solid foundation to help you if you lose your job, get sick, or have to take time off work for other reasons.
What are Sinking Funds?
In addition to an emergency fund, you may consider setting up sinking funds (I also call them non-recurring & random expenses). These are savings accounts designated for specific goals. This money management method is effective to get a clear picture on how much you should be saving and where you are with your progress.
For example, you could have these sinking fund categories:
- Home repairs
What are high-interest savings accounts available for Canadians?
If you bank with a big-bank in Canada you may be hesitant to have multiple savings accounts because there could be more fees involved. Traditional bank fees range from $4-$15 or more and these monthly fees can quickly add up.
Spending just $12 a month for a year is $144 a year! In five years, you’d be paying $720 in bank fees alone.
Unless you enjoy using the teller services and physically going into the bank to manage your financial affairs, there are free alternatives that save you fees. In Canada, there are a handful of online banks that offer savings and checkings accounts as well as credit cards, loans, and investing opportunities. With online banking, all of the information you share is held in the strictest confidence and is compliant with privacy standards required of all major Canadian financial institutions.
Tangerine Bank is one of the most comprehensive banks on the Canadian market. They offer mortgages, loans, investment products, and more. In terms of savings accounts, Tangerine offers:
- Savings Accounts
- Tax-Free Savings Accounts
- RSP Savings Accounts
- US$ Savings Accounts
- RIF Savings Accounts
If you are a business owner, this online bank offers:
- Business Savings Accounts
- Business US$ Savings Accounts
- Business Guaranteed Investments
- Business US$ Guaranteed Investments
On top of all these savings accounts, experience no-fee daily chequing and earn interest on every dollar in your accounts. With Tangerine, you get:
- No fees for daily transactions
- Free Interac e-Transfer®
- Free access to 3,500 ABMs (They are affiliated with Scotiabank so you can always use their ATM’s to make withdrawals and deposits for free)
- Overdraft Protection (requires application)
One of the best parts of having a Tangerine account is that you can have multiple sinking funds, at no extra cost. It’s so easy to see your savings goals and stay on track with the right systems in place.
Open a Tangerine account today:
EQ Bank does not have everyday banking fees, which helps you save more! You can open a high-interest savings account with no minimum balance and you get unlimited transactions as well! One of the bonus perks with EQ Bank is the International Money Transfers. You can use TransferWise directly from your EQ Bank account and there are no hidden fees. In 2017 and 2018, EQ Bank was awarded “best savings account,” by Ratesupermarket.ca . EQ Bank is consistently recognized for the high-interest rate on the EQ Bank Savings Plus Account. So if you’re looking for a compact banking solution with a high interest, open an account today.
Simplii Financial has been around for a while. Previously, it was known as PC Financial and in 2017, Simplii took over customer accounts.
With Simplii Financial, you can manage your money online, on your phone or at any CIBC ATM with no monthly fees. You can also apply for loans, mortgages and purchase investments. You get benefits like mobile cheque deposits, 3D Touch (which makes banking a lot faster on Apple devices), and you can add your Simplii debit and credit cards to Apple Pay, Google PayTM and Samsung Pay®.
Do you have any questions or anything to add? Leave me a comment in the comments below and I will respond back to you!
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- How to Improve Communicating about Money with Your Partner
- Should You Use Your Savings to Pay Off Debt?